RBI penalises Dr. Babasaheb Ambedkar Nagari Sahakari Bank ₹80,000 for compliance breaches

The Reserve Bank of India has imposed a monetary penalty of ₹80,000 on Dr. Babasaheb Ambedkar Nagari Sahakari Bank Ltd., Aurangabad. This action follows the bank's failure to comply with specific RBI directions concerning 'Exposure Norms & Statutory/Other Restrictions – UCBs' and operational instructions under the 'Supervisory Action Framework (SAF)'. The penalty was levied under the Banking Regulation Act, 1949, after a statutory inspection of the bank's financial position as of March 31, 2025, revealed sustained charges of non-compliance.

The breaches identified include exceeding prescribed regulatory ceilings on certain advances and offering interest rates on deposits higher than those provided by the State Bank of India, deviating from SAF directives. This enforcement action by the RBI targets regulatory deficiencies and does not affect the validity of any transactions between the bank and its customers. It serves as a reminder of the stringent compliance requirements for urban cooperative banks and the RBI's oversight mechanisms.

Glossary

UCBs: Urban Cooperative Banks, a category of cooperative banks operating in urban and semi-urban areas.

SAF: Supervisory Action Framework, a set of prudential measures implemented by the RBI to address the performance and financial health of Urban Cooperative Banks.